In response to the recent $230 million hack on WazirX, India’s Bharat Web3 Association (BWA) has intensified its efforts to bolster cybersecurity and enhance consumer protection within the cryptocurrency industry. The incident has prompted the BWA to form two new internal groups focused on these critical areas.
New Initiatives and Task Forces
Under the leadership of Dilip Chenoy, the BWA has established a cybersecurity group and a consumer protection group. The cybersecurity group, composed of chief information security officers from member firms, aims to develop standard operating procedures and implement measures to prevent future breaches. This group will work to strengthen the security infrastructure and ensure that best practices are followed across the industry.
The consumer protection group, on the other hand, will focus on updating guidelines and safeguarding user interests. This initiative reflects the BWA’s commitment to maintaining trust and integrity within the digital finance space. Chenoy emphasized that the BWA is closely monitoring the situation and has called for a thorough investigation into the breach. The association has requested a comprehensive forensic analysis and root cause evaluation from WazirX and Liminal, along with potential legal and remedial actions.
To ensure a neutral and objective review, the BWA has recommended a third-party evaluation of the forensic report. This independent assessment aims to provide a transparent understanding of the breach and its implications.
Expanded Focus on Cybersecurity
Traditionally, the BWA has concentrated on regulatory compliance, including registering with the Financial Intelligence Unit and implementing Anti-Money Laundering measures. However, the recent security incident has highlighted the need for a greater emphasis on cybersecurity. The association’s scope now includes a broader range of issues, from regulatory compliance to protecting the digital assets and personal information of users.
The BWA’s membership includes major players like Coinbase, Polygon, CoinSwitch, Liminal, Biconomy, Tax Nodes, Giottus, and Hike. In light of the WazirX hack, the BWA has also brought in CoinDCX, a local competitor, to participate in the newly established groups. These collaborative efforts aim to update consumer protection guidelines and address current cybersecurity challenges comprehensively.
Implications of the WazirX Hack
The hack on WazirX, one of India’s largest cryptocurrency exchanges, resulted in the loss of approximately $235 million, impacting 45% of user funds. This event marks the second-largest hack of a centralized exchange in recent times and has significant implications for India’s cryptocurrency sector. Despite government pressure, the sector has continued to grow, underscoring the need for robust security measures.
On July 27, WazirX announced a strategy to minimize disruption for its users and maintain platform stability. The BWA’s proactive measures aim to prevent similar incidents in the future and reassure both users and stakeholders of the industry’s commitment to security and transparency.
